Defendants filed an emergency motion to stay the case pending an appeal of the PTAB’s decision that invalidated all of the asserted claims in the patent-in-suit. Earlier in this case, Defendants had petitioned for inter partes review (“IPR”) of all of the claims at issue in the patent. The PTAB granted review, and the Defendants subsequently moved for a stay pending completion of the IPR.

Although the court acknowledged that the IPR process had the potential to simplify issues for trial, the court determined “that a stay was not justified because the parties had made significant progress toward trial and a stay would deny the Plaintiff an expeditious resolution of its patent rights.” As a result, the litigation and the IPR proceeded concurrently.
On May 15, 2015, the PTAB issued a Final Written Decision in the IPR, holding that all of the asserted claims of the patent are unpatentable under 35 U.S.C. § 103. Although the plaintiff had not yet filed an appeal of the final written decision, Defendants filed the motion to stay the case while the Federal Circuit hears Plaintiff’s appeal.
The court analyzed the motion under the same three-factor test as the motion to stay pending IPR: “(1) whether discovery is complete and whether a trial date has been set.; (2) whether a stay will simplify the issues in question and trial of the case; and (3) whether the stay would unduly prejudice or present a clear tactical disadvantage to the non-moving party. NFC Technology LLC v. HTC America, Inc., 2015 WL 1069111, *2 (E.D. Tex. Mar. 11, 2015).”

The court found that the case had proceeded to a late stage in the litigation, with the trial only four months away, the parties had largely completed claim construction, and fact and expert discovery have concluded. The court concluded that although this factor does not support staying the case, the “appellate review of the PTAB’s decision finding invalid all of the claims at issue will certainly simplify this case by providing resolution of a key claim construction issue about which this Court and the PTAB came to different conclusions. . . . As such, the second factor favors staying the case.”

The court then addressed whether the stay would unduly prejudice the plaintiff. “Motion Games argues a stay will cause undue prejudice because the Court has already ruled that staying the case is prejudicial and the parties have expended significant resources completing fact and expert discovery and resolving numerous discovery and substantive issues. Contrary to Plaintiff’s argument, there comes a point at which any prejudice to the Plaintiff in staying the litigation is significantly outweighed by a determination that patent claims are invalid by the “expert agency” in the field. See NFC Technology, 2015 WL 1069111, at *5. Typically, at that point, any further expenditure of party or judicial resources on invalid claims is unwise. While it is true that significant resources have been invested to this point, there is little doubt that a substantial amount of pretrial, trial and post-trial resources have yet to be expended. Certainly, if the Federal Circuit disagrees with the PTAB, the litigation can resume. But until then, a stay of the case is appropriate. Moreover, Plaintiff was certainly aware that the PTAB could invalidate all of the relevant claims of the ‘607 patent. If Motion Games did not want to risk its time and resources litigating before this Court during the IPR proceeding, it could have simply agreed to Defendants’ prior motion to stay.”

Stan Gibson, an experienced technology and IP trial lawyer, represents inventors, manufacturers, owners and others in litigation centering on complicated technology. Stan's practice is national in scope and he represents both plaintiffs and defendants and has litigated dozens of cases on behalf of his clients, taking many of them to trial. Although most cases settle, Stan's ability to take cases to trial enhances their value and drives favorable verdicts and settlements. Contact him at 310.201.3548 or SGibson@jmbm.com.

Greg Cordrey, an experienced patent litigator and former flight test engineer, represents a wide range of industries including medical device, computer, e-commerce, semiconductor, automotive, aircraft, and consumer products. He has litigated patent cases nationwide and has practiced before the Federal Circuit and the U.S. Patent and Trademark office as a registered patent attorney with experience in concurrent litigation and patent reexamination proceedings. Greg is recognized as one of the "Best Lawyers in America" in IP Law, as well as a "Super Lawyer" and "Rising Star." Contact him at 949.623.7236 or GCordrey@jmbm.com.

Rod Berman is recognized by the Daily Journal as one of the top 30 intellectual property attorneys in the State of California, and by the Los Angeles Business Journal as one of the top 100 attorneys in Los Angeles. Rod's practice focuses on patent, trademark, copyright, unfair competition and internet responsibilities and includes counseling, litigation, opinions, licensing and prosecution. In addition to being a registered patent attorney, Rod is a court-recognized expert in patent and trademark law, and has successfully argued before the Federal Circuit. Contact Rod at 310.201.3517 or RBerman@jmbm.com.

Andrew Shadoff, is a litigation associate who has assisted in prosecuting and defending patent infringement lawsuits involving mechanical devices. He has drafted successful summary judgment motions and pretrial motions in limine, and has assisted with trial and witness preparation. Contact him at 310.712.6856 or AShadoff@jmbm.com.

Joe Mellema's practice focuses on litigation in federal and state courts, including the protection and enforcement of intellectual property rights, and business and commercial disputes. He has handled patent, trademark, copyright, trade secret, unfair business practices, antitrust, and business and commercial lawsuits in all phases of litigation and arbitration. In addition to a law degree, he has dual degrees in electrical engineering and physical sciences, and was formerly a systems engineer at Raytheon Company. Contact him at 949.623.7232 or at JMellema@jmbm.com.

Rachel Capoccia

Rachel Capoccia focuses on technology-based litigation and counseling, with an emphasis on patent litigation, copyright litigation and other technology-related matters. Her legal experience is complemented by 10 years working at IBM as a software engineer before law school, during which she led a team of engineers who developed computer graphics software and computer aided design systems. She represents clients in all phases of patent infringement matters involving diverse areas of technology. Contact Rachel at 310.201.3521 or RCapoccia@jmbm.com.

Jessica Newman is a litigation associate, and a member of JMBM's Patent Litigation Group. She is involved in all aspects of litigation and has assisted in representing clients in a variety of industries with regards to patent infringement and copyright infringement issues. Contact her at 310.785.5372 or JNewman@jmbm.com.